Art for Less

Local fund-raisers. New approaches to art fairs. With prices rising faster than ever, savvy collectors are shifting their strategies for nabbing deals. Where to find the next bargains.

By

Lauren A.E. Schuker

Updated July 21, 2007 11:59 p.m. ET

Over three decades of collecting for herself and corporate clients, art adviser Lisa Austin landed good deals by cultivating relationships with galleries. "Those days are over," she says. With the art market booming, dealers are flooded with buyers and bargains are often scarce.

Lately, Ms. Austin devotes significant time to scouting fund-raisers like a recent "Smash and Grab" event to benefit a Miami nonprofit art group. For an entry fee of $375, every attendee was guaranteed one work -- if they could grab it before someone else. To claim the piece she wanted, a work made of glass mirrors by Karen Rifas, Ms. Austin literally sprinted past other collectors and dealers. "Of course I made a mad dash for the piece," says Ms. Austin, adding that Ms. Rifas's pieces typically go for thousands of dollars. "I was getting something for nothing."

A collage by TM Sisters, sold at a Locust Projects auction. Locust Projects, Miami

The art market continues to expand at a breakneck pace -- sales for the two biggest auction houses, Christie's and Sotheby's, were up a combined 42% last year, to $8.4 billion. That's driving up prices and giving life to once-obscure categories. It's also causing some veteran collectors to refine their tactics, and tap new areas to find bargains.

In addition to fund-raisers such as the one Ms. Austin attended, popular art fairs can still be a source of reasonably priced works -- if you know the trick to finding the deals. (Be prepared to stay late.) As for emerging markets, with buyers already wise to China, some savvy collectors recommend searching even farther afield, to places like Scotland and South Korea.

In markets already heating up, one approach is to examine less popular categories. Peter Nagy, a former New York dealer who now operates the Nature Morte gallery in New Delhi, says Indian photography is still overlooked. While paintings by midcareer contemporary Indian artists generally go for $20,000 to $60,000 and sometimes up to $100,000, photography by these same artists can sell for $1,000.

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The changing calculus for bargain hunters comes amid broader shifts in the art world. With auction houses thriving, the big companies in that industry are now expanding into the gallery business too. Meanwhile, the world of art fairs continues to grow rapidly: There are now close to 20 "satellite" fairs that have popped up around Art Basel Miami Beach to take advantage of surging interest in that show.

With the hunt for bargains veering to less traveled parts of the market, buyers say knowing how to conduct due diligence is critical. Unlike works sold by auction houses or blue-chip galleries, the art at local fund-raisers or in some emerging markets may come without the imprimatur of an experienced curator -- placing the burden of researching the artist on the buyer.

Experts suggest looking for artists who have taken part in group shows at small, regional museums or galleries, who have a graduate degree from a good art school, or who have appeared in big-name collections. In cases where dealers have waiting lists or multiple buyers, displaying knowledge about the artist -- and, of course, a clear intent to purchase -- can provide an advantage over the competition.

Below, a look at what collectors say are some key strategies for finding underpriced art.

The Late Bird Gets the Art Deals

Buy late, not early.

ENLARGE

An art auction at an Acria fund-raiser in the Hamptons.

That's the new thinking about major art fairs like Art Basel Miami Beach and the Frieze Art Fair in London. For years, people have clamored to get a ticket to the "private views," the exclusive showings that take place on the first day of fairs. But more galleries now presell most of their art before the actual fair, so much of what is on display during the private views has already been spoken for. To compensate for this, more galleries now bring along a second set of works to hang during the back half of the show.

It's on the final day of the event, when dealers are particularly eager to sell, that they may pull something out of the closet that hasn't been displayed yet. And because galleries are loathe to pay the steep price of shipping unsold items back home, they will often give buyers a discount, especially on bulky pieces, sometimes throwing in the shipping or a frame for free.

Collector Paige West picked up a 2005 Erwin Olaf photograph at the Pulse New York fair last year for $13,300 that had been listed for about $17,000. Ms. West says she thinks the gallery, Gallery Magda Danysz, was willing to negotiate because it didn't want to ship the photograph back to its Paris headquarters. "It's terrible to say, but most galleries are interested in offloading," says Ms. West, who herself owns a gallery in New York.

Major Finds at Minor-League Fairs

As a way to recruit new collectors, affordable art fairs -- which often sell pieces for as little as $100 -- are taking off. But more serious collectors are turning up to scour their offerings.

Art Prep: How One Pro Gets Ready to Buy

Lisa Hunter began buying student art in college, and today is one of the top collectors of affordable art. Over 20 years, she has amassed a stockpile of crafts, prints, paintings and photographs centered on theater and film -- never spending more than $7,000 on an item. We asked her to walk us through how she prepares for shows and spots likely bargains well before she walks in the door. Here's how she would prepare for the upcoming American Craft Show in San Francisco, one of the most important events for collectors of craft art.

—Lauren A.E. Schuker

1. As far in advance as possible, Ms. Hunter reads targeted art publications to get more conversant about the particular genre. For this fair, she would scan magazines like American Craft, Fiberarts and Ceramics.

2. A week before the fair, she will check the Web site (http://www.craftcouncil.org/sf/) to see which art she likes on a purely aesthetic level, bookmarking those pages so she can easily find them again. In the case of the San Francisco fair, 12 of the show's 250 artists catch her eye.

3. She takes that list of artists and begins looking into their professional backgrounds -- as well as viewing more of their work -- to get a better feel for their investment potential. Ms. Hunter quickly eliminates some of the 12 artists when she sees that their other crafts -- including some decorated with bunnies and other animals -- are too cutesy and commercial.

4. While researching, she finds that one of the artists she likes, Andrea Tucker-Hody, who makes collages with handmade paper, graduated from the Pratt Institute, a top art school in the "crafts" sector -- a good sign. But then Ms. Hunter sees that Ms. Tucker-Hody doesn't have her own Web site, and the only price Ms. Hunter finds for her on the Web, $2,300, seems much higher than those of many better-known artists. On a closer glance at the artist's resume, Ms. Hunter also discovers that Ms. Tucker-Hody hasn't exhibited at either of the three top fairs for craft art, the Smithsonian Craft Show and the two SOFA fairs. Based on that information, Ms. Hunter concludes that Ms. Tucker-Hody is more of a local artist to track than a national artist to buy immediately.

5. At this point, Ms. Hunter has eliminated nine of her initial picks, leaving her with a short list of three artists: Masuo Ojima, Myra Burg and Elaine Hyde. To find more details on their pricing, she goes to artnet.com, which lists auction results. Because most emerging artists haven't sold at auction, she browses the site for prices of artists who have similar backgrounds or are working in a comparable medium.

6. After doing that, Ms. Hunter knows that all three artists are in her affordable range -- $150 to $2,500 -- and she can shoot off an email to them and their dealers, announcing her interest and intention to buy at the fair. She might also use the opportunity to ask if the artist has anything smaller or cheaper than the prices that she found online.

Last year, securities trader and art collector Mike Hoeh, who focuses on contemporary photography, bought a large painting at Pulse Miami in the style of a Polaroid picture by one of the fair's featured artists, Ellen Harvey. The piece cost $9,000. Ms. Harvey's gallery, Gallery Magnus M&uuml;ller in Berlin, says that comparable works from her now sell for at least $12,000.

For newer buyers to the affordable-art circuit, the key is showing up armed with names of some artists that have investment potential, rather than using the fairs to window shop. Four or five hours of homework before visiting these fairs can make a huge difference.

Here's what do: Look for artists who have participated in group shows at well-regarded museums like the Walker Art Center in Minneapolis; Dallas Contemporary; the Institute of Contemporary Art, Philadelphia; the Seattle Art Museum; and the Studio Museum in Harlem. Museum Web sites have rosters of artists who have appeared in their shows. Mr. Hoeh also recommends subscribing to the museums' email lists to keep tabs on emerging artists exhibiting at those places.

Art-collecting.com lists affordable art fairs by month and provides links to their Web sites, which show some of the art being displayed. Affordable art fairs range from more regional events like Ann Arbor Street Art Fair in Michigan, which is taking place this weekend, to the NADA Art Fair in Miami, which is populated by some of the most successful younger dealers in the country.

Getting Schooled in Student Art

Last year, a New York gallery put on a show of works by artists still in graduate programs at Yale, Columbia and Hunter College -- and sold more than 70% before the show even opened.

Student art has become one of the hottest areas for bargain hunters in recent years. Searching for these pieces can be more time-intensive than some other strategies, but there's a payoff: access to potential star artists early in their careers.

One of the best ways to find student art is "open studios," once- or twice-a-year events (depending on the school) where the public is invited to the students' studios. Typically, the students are set up in their studios, the artist equivalent of an office, with their art arrayed around them. These are opportunities not so much to actually buy the art as to meet the creators. A big advantage of this approach is the chance to see the full range of a student's work -- far more than would be on display at a one-off auction -- and take home a CD with samples.

If there are artists that seem promising in this initial visit, the next step is to do some research on them. And the obvious first place to look is their r&eacute;sum&eacute;s. Good signs include previous sales -- not to relatives but to people in the art world, including the school staff -- or apprenticeships with older, reasonably well-known artists.

If the artist passes this test, too, contact him or her directly to arrange another studio visit. That's the time to ask if there are other works to see and discuss buying something. Many artists will be willing to part with works for well under $500, but some of their best pieces may go for closer to $1,000 or, these days, even up to $10,000. MFA programs are typically two years, and buyers have an incentive to act earlier in this cycle: The closer students get to graduation, the greater the likelihood that they will be represented by a dealer. That can in most cases at least triple prices for their art.

Donald Cameron, who graduated from the Cranbrook Academy of Art in May, sold a work this past April for $125 at the student auction there. Now, Mr. Cameron's oil paintings are selling at a Chicago gallery for between $5,500 and $8,000.

To find out about opportunities to buy student works, go to the art schools' Web sites -- start with schools in your area. According to some art advisers, good schools that fly under the radar of the East Coast-centric collecting establishment include: the Cranbrook Academy of Art, outside Detroit; California Institute of the Arts in Valencia; Columbia College Chicago; and Maryland Institute College of Art.

Another place to do some research is Ugallery.com, a Scottsdale, Ariz.-based Web site started last fall by three recent college graduates. It offers works by more than 100 artists from 66 different schools, including Arizona State University, Savannah College of Art and Design, and Massachusetts College of Art. Paintings sell for an average of $400 and photographs for $100. To find young international artists, try collector Charles Saatchi's site, "Stuart," which was started last year as an offshoot of his online gallery.

Benefiting From Small Fund-Raisers

Major charity auctions often feature art, but smaller local charities can be a better place to find under-priced art -- and little or no competition from major collectors.

ENLARGE

As the art market heats up, small, local charities -- as well as art galleries and museums -- are increasingly trying to tap artists' sense of civic responsibility and asking them to donate original artworks for fund-raisers.

These fund-raisers come in several forms. Some are actually raffles. Attendees buy a ticket -- usually for several-hundred dollars -- that guarantees them at least once piece of art. (The cost of the ticket includes the piece of art.) The smart strategy is to get to the event as early as possible, look at the hundreds of donated works, and jot down the numbers of a few that seem promising. When an attendee's ticket is picked from the hat, he has to immediately declare the piece he wants by putting a red dot on it.

Other fund-raisers follow a live-auction format, where the bidding is done verbally, just like it's done at a place like Christie's or Sotheby's. But there's one big difference: Unlike at a big auction house, there's often no reserve price, or minimum, so a piece can sell for as little as a collector will offer. Point being: bid low. Other fund-raisers use silent auctions, where buyers jot down their bids on paper. Some auctions let buyers preview the work the week beforehand and make initial bids.

Every two years, the Museum of Contemporary Art, Los Angeles, has a silent auction of several hundred works from emerging artists, both lower-priced pieces and more expensive works normally only available to collectors whose names are at the top of long waiting lists at galleries. At LA MOCA's silent auction in 2005, a collage by Elliott Hundley sold for $7,000. Mr. Hundley, who works with cut-up magazines, personal photographs, and everyday objects like strings, paper, and feathers, had just finished his master's of fine arts at UCLA, and his work was rare even then. Today, a Hundley collage sells for between $25,000 and $34,000 -- if you can get one.

The artists who donate the works to these fund-raisers often have mixed feelings. They want to support the causes, but there's a cost: Their art often sells for much less than it would at retail. Another complaint: They can't even deduct (for tax purposes) the fair market value of the work they donate -- only the cost of the materials used to produce it. Donald Cameron, a young artist in Chicago, says that while he doesn't like the practice of giving away work, "it's encouraged, almost required -- I mean, it helps you meet a lot of people that will make your career," he says.

Buyers should avoid charity events where only a very limited number of pieces are sold and major collectors turn up in droves. The Metropolitan Opera in New York, for instance, recently held an event where a John Chamberlain sculpture was auctioned off for $625,000.

Finding the right auctions before everyone else does can be a challenge, particularly because some galleries that used to hold these benefits have stopped doing so, or now don't publicize them as loudly. Regional museums often do mailings about these kinds of events. Potential collectors can also comb through local calendars for auctions, some of which take place in wealthy vacation communities like the Hamptons, Miami and parts of Maine.

Blazing a Trail in Emerging Markets

Fifteen years ago, Jean Pigozzi traveled to Africa to buy work directly from artists. Now, Mr. Pigozzi, a venture capitalist in Switzerland, owns the largest collection of contemporary African art in the world.

Thanks to globalization and the increasing sophistication of the international art market, more developing countries now have at least some art infrastructure, whether it's an art fair or a gallery guide, to help steer potential collectors. In Mr. Pigozzi's day, he was walking from one artist studio to another without any assistance.

Though dealers have already descended upon China and India, it's still possible to find works with a high chance of appreciation in these and other markets. And buying directly allows a person to avoid the high markup that is part of going through a well-known gallery in the U.S. Emerging markets attracting attention include Scotland, Australia, South Africa and South Korea.

The caveat here, of course, is that these artists are chancier because less information is available about them. Some of the litmus tests that can be used to gauge an artist in the U.S., like where they went to art school, don't apply in emerging markets. And many of these markets don't have extensive lists of galleries or rich collecting cultures.

The best bet is to find a local gallery that seems trustworthy -- or a gallery in the U.S. that's knowledgeable about the region -- and use it to help navigate the terrain.

Curators and administrators from major Western museums are increasingly relocating to emerging markets to get a ringside seat. Virginia Ibbott of the Tate Modern in London is moving to Beijing this fall to help open a contemporary art museum. She recommends that collectors look at the Guangzhou Photo Biennial and the Shanghai art fair.

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